Cor rises amid takeover speculation

CBS.MarketWatch.com

SOUTH SAN FRANCISCO, Ca. (CBS.MW) -- Shares of Cor Therapeutics rose more than 11 percent Thursday amid speculation about further consolidation in the biotechnology industry.

Shares of the South San Francisco, Calif.-based biotech company
CORR, +0.19%
rose 2 to 19 3/4. The stock bucked a broader market sell-off that saw the Dow Jones Industrial Average fall nearly 200 points. See Market Snapshot.

The rise echoed a similar ascent on May 27, when the Dow also dropped more than 200 points and Cor's stock jumped more than 10 percent. On Thursday, Cor's chief executive, Vaughn Kailian, declined to comment on the stock's rise. "We don't comment on rumors or speculation," he said.

Cor, Gilead Sciences
GILD, +0.37%
and Vertex Pharmaceuticals
VRTX, +0.80%
are among the companies whose fundamentals are good and are improving, said Kurt von Emster, a portfolio manager Franklin Biotech Discovery Fund. That means they are most likely next in line as potential takeover candidates, he said.

"The companies have the few growth drugs out there," von Emster said.

One potential buyer for Cor might be Chiron
CHIR, +0.00%
"which has said they're interested in the cardiovascular therapeutic area," said Michael King, an analyst at BancBoston Robertson Stephens.

Analysts also said that larger pharmaceuticals companies that need to fill their pipelines with new drugs are also likely buyers.

"There have been a number of takeouts," said Carol Ann Werther, an analyst at Adams Harkness & Hill, referring to Johnson & Johnson's planned purchase of Centocor and Pharmacia & Upjohn's planned acquisition of Sugen, to name two. "I think there will be more," she said.

Earlier this month, Johnson & Johnson said it agreed to acquire the biotech company for about $4.9 billion in stock. .

Abbott Laboratories has also been an aggressive buyer in recent months.

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